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KiwiBuild roundup

Written By: - Date published: 7:41 am, November 22nd, 2012 - 144 comments
Categories: housing, labour - Tags:

With everything else going on, KiwiBuild didn’t get the attention that it should have. But there was still a range of reaction in the media. RNZ had a mixed review:

Critics doubt Labour housing plan will solve crisis

[Labour] says under the scheme, first-home buyers will be able to buy a modest house for about $300,000. …

However Hugh Pavelitch, co-author of the annual Demographia International Housing Affordability Survey, says that is still more than five times the average New Zealand salary, so is not affordable by international measures. Mr Pavelitch says Labour is ignoring the two main drivers of the housing affordability crisis – land supply and lack of infrastructure investment. …

The Registered Master Builders Federation says despite losing thousands of skilled workers, it could train new staff and gear up over several years. The federation says it is currently building about 30% to 40% fewer homes than its long-term average. Chief executive Warwick Quinn says a programme such as the one Labour is proposing would give builders much-needed confidence in the market. Mr Quinn says providing growth increased over several years, the industry would be able to bring through apprentices to help build significantly more homes. ….

The Salvation Army has welcomed the policy, saying it has previously called for a large-scale approach to build housing. The national director of its social policy unit, Major Campbell Roberts, says more detail is needed, especially on the ability to build that many additional homes.

Of course it isn’t going to “solve the crisis” no one ever claimed it would. But it is going to help. Economist Peter Lyons writes in the ODT:

Shearer’s building plan has merit

Labour leader David Shearer has painted a bold vision. His KiwiBuild announcement is big picture stuff. He has announced Labour’s intention to build 100,000 affordable houses for first-home buyers over the next decade in a public-private arrangement.

My main reservation is where is the land coming from? This appears to be the main problem of housing affordability in certain areas at present.

The reason I like the announcement is that average houses in New Zealand are way overvalued. Our houses are generally nothing spectacular as dwellings but we are paying premium dollars for them.

This is an aspect of our economy which we have control over. We can’t control international oil or dairy prices and the productivity of our farms is limited by technology. We do have the ability to control the prices we pay for our houses, if we choose to exercise it as a nation. …

Mr Shearer has pointed to the big advantage a government-sponsored building programme has. It is economics of scale. This should ensure a fall in construction costs for first homes but it doesn’t overcome the issue of land costs in key areas. …

I applaud Mr Shearer’s big picture approach. He has identified the major area of our economy over which we have control if we choose to exercise it. He will be criticised by market zealots who abhor any form of government intervention. He also needs to confront the land affordability issue.

But as an avenue to economic prosperity the plan has merit. It will create jobs and skills and reduce the price of the main financial transaction in most peoples’ lives. It is far superior to relying on monetary policy and low interest rates, which serves to further inflate house prices and indebtedness. Unless we solve this housing affordability issue we will continue our economic stagnation and relative decline. We can fix it if we choose to.

An anonymous editorial in The Herald is likewise supportive:

Kiwi build solid base for future at last

The previous Labour Government bequeathed the country KiwiSaver, Kiwibank and KiwiRail. The next one proposes to establish “KiwiBuild”, a construction programme that could help many young couples afford their first home. …

If Labour is wrong, its project would divert a great deal of the country’s building industry into activity of little value and the economy would suffer. But if it is right, many young first-home seekers would reap the benefit. For the moment, the party has a concrete policy to clarify its political character and offer voters something distinctive at the election two years from now.

By far the best coverage came from Brian Rudman:

It’s bold, but Labour housing scheme looks do able

Whatever the eventual outcome of Labour’s leadership struggles, let’s hope the brave and adventurous Kiwibuild housing project announced by leader David Shearer at last weekend’s party conference, doesn’t get lost in the melee. Any young Aucklander seeking to buy a first home, knows from bitter experience that the sainted “market” is failing to deliver homes they can afford to buy. …

Instead of waiting for the market, Labour’s plan is to build 100,000 affordable entry-level homes to buy over a ten year period, with two-thirds of the houses built in the first five years located in Auckland.

Mr Shearer said they could be built for less than $300,000 each, and housing spokesman Annette King followed up in a television interview, suggesting a breakdown of around $250,000 for the house, and $50,000 for the land.

Despite scepticism from political opponents, industry sources confirm that even in Auckland, this $300,000 benchmark is achievable, able to produce a one or two bedroom, 90 sq metre, two-storey terrace house, all wired and piped and ready for occupation. That’s based on a conservative costing of $1,000 a sq metre for 120 sq m of land, and a 90 sq m home, costing $2,000 a sq m to build. …

We’ll have to wait and see whether Labour’s solution for the rental crisis is equally brave.

There are certainly hurdles to clear for KiwiBuild to be successful, and no it isn’t on its own going to solve the housing crisis. But on the whole the policy has been well received. It will have a significant impact on housing supply, it will create jobs and economic stimulus, it is the most ambitious state building program in over 50 years. I’m sticking with my first reaction, this is a historic policy.

144 comments on “KiwiBuild roundup”

  1. David H 1

    I’m sorry but this just shows how far out of touch Shearer and co are. Yay! Lets build thousands of houses, and we will charge 300k each for them. And they are for New home buyers, and the poor. Oh well, when they have stood derelict for years, not built, or rented out. BECAUSE WE DON’T HAVE 300K for a house, I don’t have $30 spare. This is why Labour will go down in 2014. A leader that’s useless. A Caucus that’s out of control. And pie in the sky policies like this.

    Now how about something about jobs??? No Too Hard?
    Warm Houses?? Greens Policy
    Bashing beneficiaries for painting roofs?? Easy Peasy. National AND Labour policy.

    My Predictions for 2014
    National
    Greens
    Mana
    Labour

    And I have been saying this for a while except that now even I have the Nacts winning due to the bullshit from last weekend. What a weak kneed, panty waist, Shearer has become.

    • r0b 1.1

      I guess for a while every post is going to turn in to an “I hate David Shearer” discussion. Tedious, but there it is.

    • Tracey 1.2

      You do get that building that many houses will create jobs, don’t you? Probably more than, say, two mines and an oil rig

    • Pete 1.3

      You can have a small one or two bed now for that price, but few people seem to want to live in them. They want three bed and a yard.

      Labours plan appears to be – according to Rudman – horizontal apartments. Good luck getting a car park outside your house, too.

  2. vto 2

    It would be interesting to see the how… any possible links to this? Poor old Shearer bumbled through his answer to this ‘how’ question last night I see. So, how?

    Great policy though and it must driven forward with determination. Forget all the nay-sayers – just point them to the state housing schemes of the past It can be done but it would be most interesting to see the ‘how’.

    • r0b 2.1

      That’s why I was reassured by the Rudman piece. He has gone out and talked to people in the industry, who say it can be done. Worth reading.

      • vto 2.1.1

        yes I see that. Either $50,000 for land and $250,000 for build, or $120,000 for land and $180,000 for build. The latter is the more probable, King’s suggestions being a bit wayward on the land side.

        So I guess the ‘how’ is slice off the usual margin and sales costs, perhaps also funding costs, and get economies of scale (quick, buy shares in Fletchers again). Not too much available through economies of scale while margin saving and those others would be around $80-100,000. How much do places of this size and type sell for currently in and around, say, Auckland? That would be a bit of a guide.

        Just curious. But the ‘how’ is not as important as the ‘do’. Just get stuck in and start building them. The costs will fine-tune nce underway and the process improve. Teething problems, no doubt, but yep, just get stuck in.

        A bit like this government got stuck in to quickly pay $1,700,000,000 to finance company investors (people alreday with homes generally), and to quickly rip away normal democratic processes in Canterbury and offer $400,000,000 to farmers’ irrigation schemes (people already with homes, and farms, generally), and to quickly offer a $35,000,000 loan to Stephen Joyce’s ex-business Mediaworks.

        Get into it in the exact same way…

  3. Hami Shearlie 3

    Even an outstanding policy needs a great salesman. David Shearer showed last night on TV3 that he is not that person. Sad but true!

  4. Chris 4

    “Of course it isn’t going to “solve the crisis” no one ever claimed it would”

    Except Labour have said it will solve the crisis, to quote from the policty factsheet – “to fix this hole in New Zealand’s housing market”, “Labour is offering a serious solution to one of our enduring issues” and finally “this solution offers a bold and comprehensive answer…”

    • r0b 4.1

      As Labour claims it fixes a hole in housing supply for those who can afford to buy (and yes the price seems too high to me, but that is apparently the best price that a house can be built at these days).

      It doesn’t address the need for an adequate supply of well priced rental accommodation, which is also a pressing need. The “housing crisis” is a multi-headed beast. Hence I would say that it doesn’t solve the housing crisis. But it’s a start.

      • Chris 4.1.1

        I agree and I hope the leadership in Labour see at as such. I worry that with a huge policy like this it could become the only thing they do about the issue – ignoring the fact that there are other items that need to be addressed in order to fix it.

  5. debatewatcher 5

    I think the policy is a bad one in terms of rorting etc. and it’s not exactly left-wing. Why not build more state houses? It’s pretty simple.

    But most voters don’t think these things through. It’s a policy aimed at the middle classes and even if few people will end up benefiting from the cheap houses (it is a lottery as has been pointed out), it might attract a few voters. The working class can probably be bribed better with a marginally higher minimum wage or no GST on fruit and vegetables (worked so well last time).

    Kiwibuild, aka Capital Gains for Families, is a cynical policy for that reason. I’m sure Mickey Savage (the historical one, not the well-known commenter here) would approve. Not.

    • Fortran 5.1

      That’s completing 192 houses a week – yea.
      Where is the land and at what cost coming from ?
      I am sure that builders can build within a cost, but such as Council fees will stuff most land purchases, before building starts.

  6. vto 6

    One thing I love about this policy is how it throws the free market back in the free market’s face.

    People cry – ooohh, rort rort, distort distort, wah wah. They can go jump. The government is entitled to act in manner as free as the free market itself. The government is just another player in the economy. So get stuck in, government, just as other players do. There is absolutely no moral or political or other basis for not jumping in and building and selling houses on terms that any free marketeer is similarly free to do…. if they can compete that is. The taxpayers and voters of NZ are as much a free market player free to do exactly as they wish just as much as anyone else. Yeehaaa, ride ’em cowboy..

    Always love it when the game gets played straight back at the game players… the look of possum in the headlights ….

    • rosy 6.1

      “The government is just another player in the economy. So get stuck in, government, just as other players do”

      ^^ This. The government has the tools, so use them. Most successful countries (economically + societally) do.

    • Kleefer 6.2

      The government is absolutely not “just another player” in the market (I won’t use the term free market because the housing market in New Zealand is anything but free). For one thing, it uses money taken from people by force as opposed to money voluntarily spent/lended. I won’t bother with this argument too much as most readers of this site support violent redistribution of wealth.

      But from a purely practical perspective, there are several important differences between the government and other market participants. One of them is that the government doesn’t have to play by the rules it sets for others. A good example of this is local councils suing dairy farms for polluting rivers while dumping raw sewage into those same rivers. Another one is how National re-wrote the RMA to “fast-track” government projects like motorways of dubious value while homeowners are left tangled in red tape if they try to so much as extend their kitchen.

      The other key difference is that, absent the “signal” given by profit and loss (which private market participants use to steer their decision-making), the government has no rational way of allocating resources. How does it decide where to build, what types of houses to build, etc? Private developers, builders etc get “feedback” from prices and from the profitability of their activities. The government doesn’t have this, and it looks like Labour is trying to somehow legislate around the laws of economics to prevent the lucky few taking advantage of the artificially low prices to get a government-subsidised capital gain.

      As one commenter above mentioned, this is probably something Savage would have opposed. Surely the point of state involvement in accommodation is to provide housing the private market isn’t providing (for whatever reason), not to try and compete on an uneven playing field with those in the market. There is huge potential here for cronyism, given that builders who aren’t the recipients of government contracts could be forced out of business by taxpayer-subsidised competitors.

      Sure, build some more state houses if you believe that’s the right thing to do, but first take a hard look at the structural issues causing housing affordability and address those. That would require acknowledging the overwhelming evidence that ring-fencing cities with urban limits causes land prices inside the boundaries to rise. Unfortunately Labour and especially the Greens deny this is the case. National seem to recognise it but have done bugger-all about it so far. Maybe when renters outnumber home-owners someone will see the political mileage that can be achieved from allowing affordable housing to be built.

      • Colonial Viper 6.2.1

        I don’t see much problem here: the Government can provide a better, cheaper deal for housing for ordinary people.

        If the private sector thinks it can do it just as efficiently and cheaply, then good for them, they can try and compete. Prospective home owners can choose the deal which suits them best.

        It’s a free market.

      • Draco T Bastard 6.2.2

        The other key difference is that, absent the “signal” given by profit and loss (which private market participants use to steer their decision-making), the government has no rational way of allocating resources. How does it decide where to build, what types of houses to build, etc?

        Ensuring that the people in society don’t live in poverty and that resource use is kept within sustainable limits seems to be quite rational to me. Certainly a hell of a lot more rational than relying upon the greed of the few and the dead weight loss of profit (and, yes, the fact that profit is a dead weight loss is proven.).

        There is huge potential here for cronyism, given that builders who aren’t the recipients of government contracts could be forced out of business by taxpayer-subsidised competitors.

        Easy solution, although i doubt that it will be sued, reinstitute the Ministry of Works and don’t hire private contractors. Be even cheaper that way as it won’t have to pay out the dead weight loss of profit to the contractors.

        The government doesn’t have this, and it looks like Labour is trying to somehow legislate around the laws of economics to prevent the lucky few taking advantage of the artificially low prices to get a government-subsidised capital gain.

        hahahahahaha

        The laws of economics that you religiously adhere to are completely fucken bunk – as has been proven time and time again over the last century or so.

        That would require acknowledging the overwhelming evidence that ring-fencing cities with urban limits causes land prices inside the boundaries to rise.

        Land price isn’t the problem – sprawl is. In fact, increasing the amount of land available will increase the costs of houses and living in them. We really do only have one option – building in more density.

    • Pete 6.3

      How dangerous a little knowledge can be vto. Or, in this case, no knowledge at all.

      The government has to play by the same council rules, therefore faces the same costs, therefore will not be able to build cheap houses anymore than a developer can now.

      The reason developers don’t build one or two bed tiny houses is because few people want to live in them, and council places restictions on density and light planes.

      Remove those restrictions, and somehow make this type of living popular, and the private sector can do sub 300k right now.

      • McFlock 6.3.1

        of course, developers aren’t in a position to rewrite any particularly cumbersome law or regulation.

        • felix 6.3.1.1

          I love how they think that just because they’ve fallen for the neo-lib bullshit about govt doing nothing, we all have to promise to do the same.

          lolz.

          • Pete 6.3.1.1.1

            You’re faced with the exact same costs that make them uneconomic now.

            If the govt removes council restrictions to make their program cheaper, great. Developers don’t want these expensive restrictions either.

            Nice to see those on the left finally grasping the costs involved in regulation.

            • McFlock 6.3.1.1.1.1

              Apart from the fact that developers would be happy putting everyone in fecking cupboards with black mould and damp. 
                   
              So they need to be restrained by regulation.
                 
              But there’s no problem with the government issuing blanket permission for a specific project or array of designs, especially when its supervision of the development is a matter of public interest. If a public official signed off on producing some of the shite I’ve seen people expected to buy or pay rent for, even one of Key’s ministers would be forced to resign. All their goddamn portfolios, too, not some fucking clayton’s resignation like “what else did I do wrong?”.

              • pete

                But there’s no problem with the government issuing blanket permission for a specific project or array of designs, especially when its supervision of the development is a matter of public interest

                The house design isn’t the problem. After all, we have the likes of Lockwood, and other companies, providing generic house builds from existing templates.

                The problem is how you use the land. This is where a big chunk of the costs lays. Herodotus points out the issues. They aren’t going to go away just because the government becomes the builder.

                • McFlock

                  So now “the problem” isn’t council regulation at all, but practical issues around infrastructure development and urban layout. 
                             
                  I’m sure those could be solved by a decently-resourced and accountable public service, just as they were for the original state housing programmes.  
                           
                  Next you’ll be complaining that the likely albedo of the dwellings will increase Climate Change. Anything to stop the plebs from owning their own homes, eh? 

            • Draco T Bastard 6.3.1.1.1.2

              Point me to the regulations that prevent developers from building cheap houses please.

              Hint: You won’t find any because there aren’t any, the reason developers don’t build cheap houses is because they can make more building expensive houses.

              • pete

                Herodotus has pointed them out.

                The house structure cost is not the issue. It has remained fairly static over the years. It’s the regulation concerning land use i.e. densities, site coverage (% of land the house takes up), light planes, and councils ticket clicking. All that adds to the total cost. In order to absorb those costs, you need to build a more expensive house.

                So, the government faces the exact same costs. If government wants to remove some of those regulations to get KiwiBuild through, great. Developers would welcome them, too.

  7. Lanthanide 7

    Is 120m2 of land legal to build a house on? Smallest sections I see in CHCH are around 320-330m.

    Funny that Annette says $50k for the land, when the above is $1k for just 120m of land, 140% more costly than her figure.

    • vto 7.1

      Lanthanide, there stacks of sites around Christchurch that have land areas around 120m2, and some a lot less. This is medium density stuff they are talking about with those numbers. Two level 90 m2 terrace houses (45m2 per level on 120m2).

      As for herodotus points below – most of those issues exist already and are not created by this policy. There are no additional issues created.

      • Herodotus 7.1.1

        Vto most issues are created by this policy , section sizes are controlled by council site coverage, height to boundary and other rules. Site coverage is part bound by what measures have been out into place and paid for by the developer to manage storm water, increase runoff require major sllutions, as not to pass on any flooding to down stream neighbours, how will this be mitigated ? We are no longer permitted to just pipe and send the untreated water into the sea

        • vto 7.1.1.1

          Appreciate all of that herodotus but this policy really does not create any issue greater than already exists. The reason is that this policy does not create more roofs over heads – there are still 4 million souls who sleep each night in our fair land.

          A policy which would create more of these issues in the manner you suggest is one which increases the population, as more roofs would be needed.

          This policy is about catering to the existing population. Instead of their roofs being rentals the roofs become their own. Same number of roofs, same amount of stormwater.

          make sense?

          • Herodotus 7.1.1.1.1

            Not really the houses that these potential 1st home buyers will still exist even if they move out of their rentals.
            Increasing density also increases the costs associated with the new buildings. The smaller the section the greater the % of land is taken up in roads. As an estimate 30% of land is taken up in roads decrease the section size the % quickly rises. Think of sections that are 25 m deep for every 50 m of depth there is another 8m of road & footpath, narrow the section to 12m2 then a road is required for every 24m2. This will increase the cost of net yieldable land. Also to comply with existing sitr coverage rules of 45% you would require a section the size of 200m, this is 67% greater than being suggested also increasing the cost. The difficulty in building creates cost implications, as storm water pipes that service lots by running down the back of the sections require bridging of foundations to support the loading on the pipes and the load bearing walls, this costs more.
            Your situation works if you are replacing existing properties with new ones or building taller, but much of the policy is in regard to stand alone houses.
            I am not opposed to the idea, t just appears to me that no one with any knowledge of the industry has been involved in preparing the figures to see if they are valid. Which then makes you wonder about the thought that has gone into such a foundation policy for the next election. Come out with a policy that has been peer reviewed and release this- as many like myself would be reassured that such a policy has been well thought out and is a goer and can be the basis of Labour 2014. But this appears lacking.
            Just one person opinion, and as an aside my 1st home was a 2 bedroom 85m2 masonry place, the size does work for a newly wed couple, but this was on a cross leased 800m2 section with 2 carports.

  8. Herodotus 8

    That’s based on a conservative costing of $1,000 a sq metre for 120 sq m of land, and a 90 sq m home, ” So we have houses built on 75% site coverage + pathways. So we have a sea of concrete and impervious areas. There is no council controls that allow for this. What of the infrastructure requirements: storm water management ( as all rain will enter the system think of the size of pipes and ponds), recreational facilities, public transport to complement such densities, power, fibre? With small sites say 10 x 12 m2 dimensions All cars will have to be accommodated by on-street parking, which will require larger width carriageways.
    The issues with such a policy is what appears to me the lack of thinking as to how it will work in reality, the tough questions are no being answered, like $300k is what in 2017, where is the land, what happens to new home owners who require 2+ bedrooms (for children, extended family) what is the cost of such a 2+bedroom house ??
    “..with two-thirds of the houses built in the first five years located in Auckland.” Where and how will the govt override town planning requirements. That takes time and $ to build the infrastructure required.
    Whilst the policy has merits its lack IMO detail that many in the industry cannot see how this can be achieved within the time frame and within $1.5b rolling debt level.
    Many here observe that lack of details to support the current govt policies, where is the same commentary for Labours ???

  9. Steve Wrathall 9

    A more rortable policy you couldn’t think of. From the same genius party that brought us GST off bananas and “working” for families credits to beneficiaries.
    http://cheezburger.com/6795321600

    • vto 9.1

      What, more rortable than the Government retail deposit guarantee scheme which cost the taxpayer $1.7 billion do you mean?

      Or more rortable than the tax evaders who each year cost the people about 100x times more than any beneficiary rorting?

      What planet are you on Steve Wrathall? You need to do some more thinking I think. Such thinking will result in the realisation that the true rorts lie on the other side of the political spectrum.

      • pete 9.1.1

        Cullens scheme was a disaster, yes.

        • felix 9.1.1.1

          Cullen left office in 2008. Bill English signed off on the scheme every time from then on.

          • pete 9.1.1.1.1

            It was still Cullen’s baby. But I agree – I was against it at the time. Rort central.

            Same goes for this Housing Lotto plan. I do hope they have a lot more details, because what’s been presented so far doesn’t make any sense.

  10. The Gormless Fool formerly known as Oleolebiscuitbarrell 10

    This is just stupid.

    The government is going to pick selected people and make them rich by selling them a valuable asset at a massive undervalue.

    A tiny number of people are going to receive free money based on winning a lottery.

    I thought the left was against unfariness.

    • vto 10.1

      Too many assumptions gormless. See my post above to steve wrathall and apply that to, let’s see, irrigation schemes around the country and the massive wealth effect that has on farmers, or, um, asset sales and the effect on those who can afford to buy the shares (or actually the lotto of applying for those shares), or, um, the NZX itself getting those massive taxpayer companies.

      you’re all out of balance mr gormless. how do manage to walk in a straight line?

      • The Gormless Fool formerly known as Oleolebiscuitbarrell 10.1.1

        So you are in favour of all of those things you listed, vto?

        • vto 10.1.1.1

          i can’t tell if you are or not

          but seriously, i imagine if demand is such for these that some will miss out while others “win the lotto” as you incorrectly describe it, then supply would be ramped up under this policy to meet that demand. pretty simple simple.

    • Lanthanide 10.2

      “The government is going to pick selected people and make them rich by selling them a valuable asset at a massive undervalue.”

      Not sure how it’s “massive undervalue”, if they’re selling it at the cost price. Also once these are in the market, the median and average market price by definition will be reduced.

      Also I’m not sure that living in a 90m house is going to be particularly desirable, especially for anyone wanting children (which most people do).

      • The Gormless Fool formerly known as Oleolebiscuitbarrell 10.2.1

        Well, you can’t have it both ways. I understood that the houses being sold for $100 grand less than they are worth was being touted as a virtue (in fact, the whole point) of the scheme.

        If the government is picking people to get a house for $100k less than it is worth, it has just made some lucky person rich.

        Just doesn’t seem very fair to me.

        • felix 10.2.1.1

          It probably doesn’t seem fair because you’re only imagining one house.

          Try again, but this time imagine that we keep building them until everyone who needs a house to live in has one.

          • The Gormless Fool formerly known as Oleolebiscuitbarrell 10.2.1.1.1

            Oh, I hadn’t realised that they were suggesting that everyone gets a hundred grand. You’re right, that seems much fairer.

            Who pays for it, again?

            Labour should totally use that as their slogan: Vote for us. Free money for everyone.

            • Colonial Viper 10.2.1.1.1.1

              The banks give out free money, why not the Government?

              • The Gormless Fool formerly known as Oleolebiscuitbarrell

                Well done, CV. You’ve solved all of mankind’s problems.

                Who do I talk to to get my free money?

            • vto 10.2.1.1.1.2

              This shouldn’t need pointing out but nobody is being given 100 grand. Think man think.

              • The Gormless Fool formerly known as Oleolebiscuitbarrell

                If you are given an assets worth $450 grand for $350 grand, you have been given $100 grand.

                • vto

                  No you are 100% wrong. Keep thinking

                • Lanthanide

                  I wouldn’t be keen to pay $450k for a house that I know the original occupants bought for just $350k.

                • felix

                  If everyone who needs a house to live in can get one for 350 then they’re not really “worth” 450 anymore, Ole.

                  ps when did it go up to 350? That was quick.

                  • vto

                    He he yep, both you and Lanthanide make similar points. One of many that gormless fails to acknowledge in his simplistic approach. I am sure he has one leg shorter than the other and that is why he walks around in circles going nowhere…. unless he walks forwards and backwrds and forwards and backwards ad infinitum thereby weaving an S down the road.

                  • pete

                    But they can’t. Well, not unless you’re going to build a lot of apartment buildings and force people to live in them by removing choice.

                    Hmmm…..perhaps that’s what they’re not telling us.

                    • felix

                      Can’t what?

                    • Pete

                      Can’t build a family home with yard for 300k in Auckland. You can build a tiny one or two bed for that right now. So Labour is offering nothing new, other that hinting at building horizontal apartments stretching off into the horizon.

                      Or perhaps they have neglected to mention theses homes are actually apartments.

                    • felix

                      You can’t. You’d be surprised how much of a discount you can get when you order them 10,000 at a time though.

                    • Pete

                      See Brian Rudmans comment above.

                      The house cost isn’t the problem. It’s the council requirements and land price, as has been explained.

                      Ignoring these issues doesn’t mean they disappear.

                    • felix

                      See my comment earlier. It’s the freakin government, they’re not subservient to local councils.

                      Just because you’ve bought into the ideology that says the government has to hobble itself to “compete” with the private sector doesn’t mean the rest of us are so blinded.

                    • Herodotus

                      Rudman comments appear lacking as he has not addressed anything regarding the cost to develop land, town planning requirements, time to earth work and complete the civils and where is the land and the difficulty in producing small sections. And as I have mentioned above that Annette King’s 120m2 sections are not workable. Which gives me some concern that a housing spokesman for Labour has no idea. So if 120m2 are not workable what does that do to the costings and ability to deliver $300k.
                      For such a major policy there should have been more thought into the workability of it.
                      Make housing affordability IMO restrict bank lending practices, limit deductibility of interest for investments, cgt , non resident buying (Not sure how you do this), increase HNZ stock as a few suggestions,

                    • pete

                      Rudman comments appear lacking as he has not addressed anything regarding the cost to develop land, town planning requirements, time to earth work and complete the civils and where is the land and the difficulty in producing small sections.

                      Exactly. He also doesn’t seem to appreciate that the buyer demand is for houses with a bit of space. There are plenty of apartments of the dimensions he’s talking about, and they are already pretty cheap, but not many families want them.

                    • pete

                      See my comment earlier. It’s the freakin government, they’re not subservient to local councils.

                      Just because you’ve bought into the ideology that says the government has to hobble itself to “compete” with the private sector doesn’t mean the rest of us are so blinded.

                      So, you’re saying that the government does have to work to the existing council constraints, just as developers have to do now, or not? Because if you’re saying they don’t, then you’re acknowledging existing regulation is a problem affecting affordability.

                      I haven’t bought into an ideology. I must work within existing law. So does the government. If you see the existing law as having a “hobbling” effect on low priced development, then we’re in agreement.

                      You’ve just admitted existing regulation is the problem, which you expect the government to change. Great. Developers welcome that, too.

        • Herodotus 10.2.1.2

          “Cost price” is misleading any accountant could make the cost fit the answer. How can in 2012 anyone comment on what the cost price of a policy that will not be known for 4 years ??
          Especially as what is being promoted is not compliant with council policy, and if implemented who pays for the new infrastructure required???
          What is the cost and dimensions for a 3,4 or 5 bedroom property ??
          Spend the resources on HNZ stock
          Where is the detail and answers to valid questions a strawman policy as it stands. Great headline but no substance

      • Draco T Bastard 10.2.2

        90m house is perfectly fine for raising children in.

        • Puddleglum 10.2.2.1

          I live in a 73m^2 house and we have a daughter. It can be a bit tight but that’s partly because we still have furniture from when we lived in a bigger house.

          I think the trick is to have a pretty big living space and minimise bedroom size. We also have an (attached) outside laundry and, up until a few years ago, an outside toilet – but I think the outside laundry is part of the calculation of the floor space.

          If we had two children we could try bunks but I guess there would be a point when we’d need an extra room (we could take some room off the living room/lounge I guess – it’s quite big, but then that would cramp the living space). 

  11. I think the policy is a clear sign of how things have changed over the last 30 years.

    I imagine that if Roger Douglas had thought of this policy back then he would have been very keen on it. It would have fitted his purposes very well.

    First, it would – like family support that he introduced – have looked ‘leftist’ by targeting the deserving ‘poor/first home buyer’, those in need, etc. and so gained the support of liberals.

    Second, it provides opportunities for the private sector to benefit from taxpayer money rather than citizens benefiting directly without the market mediating the benefit.

    Third, it weans people off the expectation that they can, collectively (in this case via the state apparatus) provide non-market solutions to social, health, etc. problems.

    It seems we are all neo-liberals now. 

    I would have thought that the best way to reduce demand in the housing market was to provide people the option of having secure dwelling outside the market.

    This seems like a lot of money to put into a market-based solution – money which could have supported various forms of social and community and cooperative housing initiatives (not just state houses) which would provide innovative options and models for the future concerning how we house ourselves in ways that provide a buffer against the inevitable trend towards un-affordability in the market.

    Increasing benefits and wages would help those who remain in the housing market to meet market prices.

    In combination, such broad economic policy changes could help alleviate the affordability issue without directly having the state operate in the market.

    I’m happy to be convinced otherwise and/or to be shown to be economically naive. Always happy to learn.

    • Saarbo 11.1

      Interesting thoughts P. I need to read the details of the policy but I think it comes back to cost. I agree with your 3 points though:

       First, it would – like family support that he introduced – have looked ‘leftist’ by targeting the deserving ‘poor/first home buyer’, those in need, etc. and so gained the support of liberals.
      Second, it provides opportunities for the private sector to benefit from taxpayer money rather than citizens benefiting directly without the market mediating the benefit.
      Third, it weans people off the expectation that they can, collectively (in this case via the state apparatus) provide non-market solutions to social, health, etc. problems.
      It seems we are all neo-liberals now. 

      • Puddleglum 11.1.1

        Thanks Saarbo.

        Yes, I understand the cost argument – building the same number of state houses, for example, over the ten years would be prohibitively expensive under current fiscal and economic settings/conditions.

        But I think the argument from cost actually takes as given the economic structures and assumptions that arise from seeing this as primarily a ‘market failure’ issue.

        It isn’t – it’s a social failure issue. Our society has allowed significant numbers of people to live in unsanitary, overcrowded conditions and/or be exposed to crippling rents.

        Once it is seen primarily as a ‘social failure’ issue then it opens the door to thinking about solutions in terms of ‘new’ forms of social organisation, rather than tweaking the market. The cost calculation would then change, presumably (and I mean that in a strictly economic/financial sense rather than in terms of social costs).

        • vto 11.1.1.1

          you’re right puddleglum, housing is a social issue.

          Televisions and cars and x-boxes and movies and fancy shirts and gadgets are market issues and the market can be left to deal with all that silly stuff.

          But housing is without doubt a social issue. How can we sit by while our neighbours live in cold, unsanitary, etc homes? It is appalling. It is also appalling that so many people see it as a market issue (take note Gerry Brownlee on your approach to east Chch residents plight, you despicable man)

          Basic necessities of life are social issues. That so many do not see or recognise that in their political outlooks is a sad indictment on our current times.

          So this sort of policy is entirely justified and can be defended until our dying days. Labour has no choice but to head down this path and it should do so with increasing vigour and determination.

        • Draco T Bastard 11.1.1.2

          Once it is seen primarily as a ‘social failure’ issue then it opens the door to thinking about solutions in terms of ‘new’ forms of social organisation, rather than tweaking the market.

          Agreed but Labour are trying very hard to make the market work and thus they put in place policies that prop-up the market such as this Kiwibuild BS.

        • rosy 11.1.1.3

          “Once it is seen primarily as a ‘social failure’ issue then it opens the door to thinking about solutions in terms of ‘new’ forms of social organisation, rather than tweaking the market”

          Yes, housing in New Zealand is a social failure and also a market failure – there is demand for affordable housing but the market can’t meet it. This policy addresses the market failure in affordable housing. That’s all. It can’t be seen as a full housing policy.

          Third, it weans people off the expectation that they can, collectively (in this case via the state apparatus) provide non-market solutions to social, health, etc. problems

          This is really important, and a problem with targeted assistance in any form. Targeted assistance can lack legitimacy and lead to stigmatisation of those receiving the assistance (one of the strong arguments for a universal income). In housing this failure of targeting is also really clear to people who have been around long enough to see the move from state housing changing from helping families into homes to the state housing being the last resort for the homeless.

          In the more successful countries, overall social policy itself has been universalistic, and targeting has been be used as simply one instrument for making universalism effective; this is what Theda Skocpol has referred as “targeting within universalism”, in which extra benefits are
          directed to low-income groups within the context of a universal policy design (Skocpol 1990)
          and involves the fine-tuning of what are fundamentally universalist policies. (p16)

          The above quote comes from a UN paper on targeting vs. universalism that argues policy assistance to reduce poverty in developing countries has been shown time and again to fail to achieve it’s target when compared to universal assistance. I believe the same holds true in the housing market. This Labour policy should have State housing in the mix to make it a policy of the left by establishing a universal rather than targeted policy (were all in this together).

          It’s interesting that the policy is drawing on the resources of the State to target to people who are not the poorest. I’m still trying to get my head around why they’ve done this. If an extra dollop of State/social housing was included it would make it a universal, and therefore (if the about quote is to believed) more legitimate policy that actually raises the standard of living for those most at risk of being homeless without stigmatising them.

          I’s sort of exploring ideas here. I live in Vienna and see the results of State intervention in the housing market everyday. It has not become the most livable city in the world by leaving housing to the free market. The State (local not national) is heavily involved in the housing market – and has been since the 1930s. Today the Viennese are looking at similar problems to Auckland – a prime city, growing fast, with a large immigrant population. The State continues to take a hands on role is planning and managing big housing developments (I mean projects that delivers thousands of homes, not just a few dozen here and there) that include private homes, private rentals and affordable and rent-controlled housing. But it does draw on the resources of the market to realise these developments. I’m trying to get a handle on how it all works together, but most stuff is written in German. One day soon I’ll have very fixed ideas on housing policy, at the moment it’s a bit difficult to work through but wanted to put my 2cents worth in from a different perspective.

          Anyway, in terms of a social-democratic policy that helps the poorest, this policy fails. In terms of a universal policy that demonstrates the State can intervene in market failures it is a good thing. i.e. that it intervenes on behalf of people who are not the poorest would not a problem if it it were a universal policy. But it’s not. It’s sort of an inverse targeting. A more complete housing policy should use the resources of the State and to integrate State/social housing within the housing policy, not as some additional targeted policy somewhere down the line (if there are plans for social housing, that is).

  12. gobsmacked 12

    I’m afraid it’s a little bit “Apart from that, how did you enjoy the play, Mrs Lincoln?”

    Yes, there has been positive media coverage of KiwiBuild. Even critical coverage is useful, because it turns attention to housing, and Labour can engage the public on an issue of their choosing, not National’s. It’s a chance for Labour to do what they want they need to: “move on” and “focus on what matters”, etc. Talk policy, talk about an issue that matters to millions.

    But … but … no round-up of media coverage can credibly exclude TV. And no round-up of commentary on a policy can credibly exclude the policy’s salesman.

    For every voter reading an in-depth ODT column by Peter Lyons, there’s a dozen more watching the evening news. Elections are (sadly) presidential, and the leader’s policy pitch is the only one most voters will notice. What they noticed last night was an embarrassment.

    I appreciate that you want to be positive, Anthony, and so do most of us, but if we’re going to talk about Labour policies in the media, then let’s talk about Labour policies in the media. Denial won’t work.

  13. $300,000 still five times the average wage proves our wages really need to go up and fast

    • Colonial Viper 13.1

      Average wage is just less than $50,000 so that factor is 6x not 5x.

      • lefty 13.1.1

        $300,000 still five times the average wage proves our wages really need to go up and fast

        The people who most need housing don’t bring in anywhere near the average wage.

        Most full time workers in New Zealanders get paid much less than the average wage and on top of that there are many who can only get part time or casual work.

        Then there are all those who can get not work at all, or are on benefits for other reasons.

        No matter how loose the criteria was they wouldn’t be likely to get a loan for a house because they have no secure income – and they would be foolish to take it if they did because it would end up becoming a mortgagee sale.

        In fact housing loans to people who couldn’t service them was what precipitated the GFC.

        Our politicians still seem to think being out of work or stuck in low paid insecure work is unusual or temporary.

        That is so last century.

        And why a third of the population don’t bother to vote for people who refuse to recognise they even exist, except for when they want to find someone to blame for the failure of their economic theories.

        • Colonial Viper 13.1.1.1

          So let’s just admit that KB is targetted at people with solidly paying jobs, $50,000 to $60,000 pa say, and does sweet very little for those earning under $20/hr.

          • McFlock 13.1.1.1.1

            Household income.
                     
            But it will also employ thousands.
               
            And it’s not Labour’s only policy.  

          • Te Reo Putake 13.1.1.1.2

            Well, to put it simply, its useful to anyone who can afford twenty bones a week ($1,042.86 pa). The government then kicks in $521.43, a 50% RoI. That $521 used to be twice as much under Labour, by the way.
             
            So, still useful at $30-50 k pa for a lot of kiwis, except perhaps for those of you living in that Auckland.

  14. Tracey 14

    To get land at those prices will be further outside Auckland SO it needs to be coupled with infrastructure of the public transport type… and let’s not copy Rodney District’s sewerage debacle…d

    • vto 14.1

      Tracey (and others above). Infrastructure is to a large extent a red herring. For example, it is usually cheaper to instal a sewer system servicing just the particular development than it is to hook up to the local Council one (they charge totally exhorbitant costs).

      • BM 14.1.1

        Which is the reason houses are so expensive, horrendous council fees.

        All that has to be done is to lower council fees, you don’t need Kiwi Build.

        • felix 14.1.1.1

          Yeah, developers would definitely pass that saving on to the buyer, especially in a housing shortage.

          *facepalm* (your face, my palm)

          • BM 14.1.1.1.1

            Do you know anything about building?
            Have you had anything to do with the construction industry?

            • Colonial Viper 14.1.1.1.1.1

              All you need is to be a capitalist to figure it out…

              • BM

                I spent a good 15 years working with and around spec builders, housing companies, developers so I probably have a bit more knowledge than Felix.

                Back in 2000 you could buy a 800m2 section in a good area for 60-70k,
                now you’re paying in the vicinity of 250k upwards.
                Cost of building the house has barely changed.

                All the cost is in the land.Council fees, regulations, slowness are the reasons land costs have exploded.

                Fix that and you’re 90% of the way there.

                • felix

                  Makes no sense at all. Regulations don’t push up the cost of land.

                  • BM

                    More the development of the land, zillions of hoops to jump through.

                    Not land cost, but do know you now need to erect scaffolding for a one story dwelling, crazy.

                    • felix

                      I agree some aspects are way over-regulated, and often for stupid reasons. It particularly bothers me how much extra expense has been lumped on to cover the arses of the manufacturers who bought us the shit materials that caused the leaky buildings debacle and the councils that ok’d it. (Stainless nails and treated framing? Give me a break, it was never a problem until some bright spark decided to make the cladding out of cardboard).

                      I see the point you’re making. I do think it’s a little overstated though.

                    • BM

                      I think Branz didn’t copped enough punishment in the leaky homes bs.

                      Most builders were just following branz approved methods, for example branz said it was acceptable to use zinc coated corner reinforcement in exterior plaster systems
                      Surprise, it started rusting a couple of years down the track, allowing water to get in behind the cladding, so they switched to stainless.
                      Tough luck for the people who had zinc though.

                    • felix

                      Yep, and who owns branz? The same companies that manufacture the products they’re certifying. And have a look at how branz changed their ownership & governance structure in the early 2000s, effectively putting a firewall between the corporate and operational divisions of the organisation to limit corporate responsibility for their dodginess.

            • felix 14.1.1.1.1.2

              Yeah I do and yeah I have. And yeah council fees are too high.

              But that’s not what’s causing a situation where ordinary people can’t afford a home and only an imbecile would say it was.

  15. tracey 15

    Vto

    You may be right but have you read about the debacle north of auckland. However its transport that interests me from the outskirts of auckland.

  16. Wayne (a different one) 16

    Won’t work, can’t work – Mr Shearer and his advisers have not done their math. 100,000 homes over 10 years = 10,000 per year, or 192 per week, 27 each day, for 10 years. Please tell us Mr Shearer, where is the labour going to come from to build these homes when we are already struggling in Christchurch to secure the workforce to undertake the re-build their.

    In addition, the economics don’t add up $300,000 house & land packages, really! Are we looking at the Chatham Islands?

    Its a dumber than dumb proposal, thought up on the “hoof” by people with no economic or strategic nouce.

    • rod 16.1

      Hey Wayne, is your surname Kerr?

      • Wayne (a different one) 16.1.1

        No Rod it’s not – so can’t accommodate your warped sense of humour unfortunately.

        But that aside, tell me Rod – you have obviously bought into this “wacky” housing proposal, so let’s hear how it’s going too work – because I sure as hell can’t work it out, we await with baited breath for your enlightened perspective.

        Or are you another sheep follower, excuse the pun! Who just simply follows the socialist doctrine, no matter what is put up?

        • Colonial Viper 16.1.1.1

          What do you mean “where is the labour coming from”?

          We’ve got tens of thousands of unemployed looking for work. Building 27 houses per day with that kind of resource is a piece of piss.

          A year to get geared up with training and what not, then full bore into it.

    • McFlock 16.2

      wow – someone gave the little parrots a line. “Wayne” is the third dropkick to use basic math and absolutely no economic or practical knowledge. 
           
      If this is typical of the arguments against, it’s a fair indication that it’s a practical policy.

      • felix 16.2.1

        It’s exactly the same line as last night, pretty much word for word.

        Sauce?

      • Wayne (a different one) 16.2.2

        Really? already the more enlightened Economists are seriously questioning the economics, let alone the basic strategic logistics.

        This is nothing more than another classic “voter carrott” like WFF and Student Loans – brilliant Labour policies that have crippled the country economically.

        McFlock, your name does you justice – “Flockin dumb”.

        • felix 16.2.2.1

          Hey Wayne, can you tell us where you got the sentence that ends with “10 years” please?

        • PlanetOrphan 16.2.2.2

          Student loans educated a Generation Wayne including u probably, freakin steal the money and run Y don’t ya.

          Our kids deserve to go to University Wayne, that’s Expensive Wayne.

          What’s your beloved Gnats’ doing to help your kids go to Uni Wayne?

          • Wayne (a different one) 16.2.2.2.1

            No orphan, didn’t go to University, so not one of those bluddgers, unlike you and your family obviously – hand out for all you can get.

            You Socialists dont get it -you are stuck in the welfare mentality, that’s why you are always bleeting about your lot – snivelling, envious knockers .

            Worked all my life (44 years), still am and, never once asked the Govt for a hand out.

            Look at the current state of the World and, ask which country’s economy is holding up very well – answer NZ – thats why our dollar is so strong – investors see NZ as a safe, stable economy.

            As for the 170,000 unemployed – perhaps these are some of those that Labour hid under the sickness benefit and ACC and National have put them correctly where they should be. But the flip side of the unemployment list, is there are a record numbr of jobs on Seek etc. So you tell me!

            • Pascal's bookie 16.2.2.2.1.1

              5:36 PM This is nothing more than another classic “voter carrott” like WFF and Student Loans – brilliant Labour policies that have crippled the country economically.

              6:02 PM Look at the current state of the World and, ask which country’s economy is holding up very well – answer NZ – thats why our dollar is so strong – investors see NZ as a safe, stable economy

              Smarter morans please.

            • Descendant Of Smith 16.2.2.2.1.2

              National must be currently hiding plenty of people on Sickness Benefit because numbers have gone up significantly under National.

              2007 49,489
              2011 53,111

              Add that to the ones they are hiding in Australia….

              And sure our economy is holding up well – but only for those of us who have managed to keep a job. There’s plenty of people suffering but yeah it’s their own fault ain’t it.

              The same people who don’t work here want to work when they go to Oz. Fuck it is magic how moving to Oz miraculously turns you from a bludger to a noble worker. Someone should develop some “substance of Oz” pills if that’s all it takes.

              A flight to Oz to make this miracle happen is cheaper than a boot-camp.

              I know plenty of people who lost their jobs in recent times and they all lost their jobs because there was no work, no contracts, cancelled contracts or the boss ripped the firm off.

              Not one I know lost their job cause they didn’t want to work.

              • Excellent comment, Descendant of Smith.

                My nephew was one of those who found the miraculous Australian cure for his bludging. He had a contract/temporary job (in fact, a series) that finished. He looked for work for several months with no luck.

                Then, in February this year went to Perth and got a job within two weeks that paid $10 per hour more (from $18 to $28) doing much the same work.

                He must have suddenly become hyper-motivated during the flight over … or something. 

            • Draco T Bastard 16.2.2.2.1.3

              You may not have noticed wayne but the worlds economy is collapsing purely due to the policies that you advocate for.

            • Tracey 16.2.2.2.1.4

              If your children went to school, you had a “hand out”, if you drive or walk or cycle on roads, you had a “hand out”. Ever gone to A & E? A hand out?

            • PlanetOrphan 16.2.2.2.1.5

              Counts for polytech to off course buddy, never went to UNI myself.
              BloodyOrphans don’t deserve it M8! , just ask the Gnats!

        • McFlock 16.2.2.3

          ” the more enlightened Economists” – lol. 
               
          Actually, Wayne, the goal is realistic given the concomitant boost in trades apprenticeships and other roles. In fact, capacity is not likely to be a problem, given the 170,000 unemployed who are celebrating dunnokeyo’s “brighter future”.

          You want more basic math: if the programme started today, there are almost two unemployed workers who can work on each house for the next three years. Quibble all you want about skillsets, qualifications and supervision: there is no shortage of site labourers at any rate.
                    
          You know what, it is a voter carrot: making society better, giving people jobs and control of their own homes, raising their standards of living… only a fucking tory would think that improving the lives of hundreds of thousands of NZers is a bad thing.
                   
          We’ve had enough tory “enlightened” economic management. Those who haven’t lost their homes, left the country, or died could do with some improvement in their lives. 

      • David H 16.2.3

        ” we await with baited breath for your enlightened perspective.” Who the fuck is WE Wayne?? You shore your last name aint Kerr?? A Wayne?

        • Wayne (a different one) 16.2.3.1

          You sound a lovely chap! Well educated, with an excellent grasp of the english language. You will no doubt go a long way in life with that attitude. But then I expect nothing less from the left!

          • vto 16.2.3.1.1

            Hello Wayne, have read some of your comments above and note an underlying mem perhaps best exposed in this of yours …

            “No orphan, didn’t go to University, so not one of those bluddgers, unlike you and your family obviously – hand out for all you can get.

            You Socialists dont get it -you are stuck in the welfare mentality, that’s why you are always bleeting about your lot – snivelling, envious knockers .

            Worked all my life (44 years), still am and, never once asked the Govt for a hand out.

            Look at the current state of the World and, ask which country’s economy is holding up very well – answer NZ – thats why our dollar is so strong – investors see NZ as a safe, stable economy.”

            A mindset which describes all university attendees (and by implication all higher learning) as bludgers is simply ignorant. Perhaps you should have got out more and done something other than have a job (note the differentiation from work. There are myriad ways to work and contribute to society you do realise. A job is merely one.)

            As for welfare mentality …. try thinking a little more. You may notice a sub-thread down further which covers how housing is a social issue rather than a market issue (despite current political ideology having it otherwise). We all have an obligation to ensure our neighbours, families, friends and wider community are adequately housed. It is entirely different from buying, for example, a television. Man is a social creature and we live in herds. We are not a bunch of individuals.

            It is nothing to do with welfare, it is to do with ensuring that our people are housed. It seems that you don’t care for how people are housed. Government is one form of organisation that can attend to this and that is what they propose.

            As for its feasibility. I have some heavy involvement in this sector and am firmly of the opinion that it can be done. In fact, more than opinion as I have 90m2 pads on my desk right now. I know their cost, I know the land supply issues, the infrastructure issues, the parameters, the margins, the lot.

            But now aint the time to go into the details other than to know it is broadly correct. The issue now is to acknowledge that housing is a social issue, that we have an obligation to house our neighbours adequately, and that this is one way to help. For fucks sake I don’t even normally vote to the left and they are stepping into my sector potentially mucking up my business but I still see that it is good policy – for society and for the economy. And it is achievable.

            I realise it becomes difficult to think in new ways, or even old ways, as age begins to creep up on us, but you should give it a go. The world is a moving beast.

          • McFlock 16.2.3.1.2

            For someone who gets their lines from a greasy cetacean and decides “Flockin dumb” is a sophisticated play on words, it’s a big call to pretend you have the intellectual high ground.
                   
            But I suppose if you view things upside down, from your perspective you’d be Oscar Wilde and Dorothy Parker’s love child. Rather than that of Carrot Top and Tommy Chong’s personae.

    • Hey wayne you can erect a prefab house in 5 days M8

      Can’t be done aye ?, your the bleedin Gnat sheep M8!

    • Draco T Bastard 16.4

      I believe you need this document where it points out that somewhat in excess of 30000 per year were consented in the mid 2000s. Of course, just because they were consented doesn’t mean that they were built but it’s a fairly good bet that most of them were.

  17. Draco T Bastard 17

    This is due to our monetary system only increasing money supply through debt which means that growth in the economy can only happen through debt. Kiwibuild has got close to zero to do with building affordable homes and everything to do with getting people to borrow again.

    • AAMC 17.1

      despite the fact we already have the second highest aggregate debt on the planet and haven’t deleveraged like others have started to. We need a jubilee before we should get people borrowing again, or the whole thing’ll pop.

  18. tracey 18

    Bm, i have alot to do with the construction industry and the developers dont suffer from the council fees, the owner/builders do. Developers get a dedicated council team, fast track, opportunity to pay fees off over months not in one go. Developers wont pass on the saving but it would impact in a small way on tge decreasing number of owner/builders.

  19. tracey 19

    How do you suggest the shortage is dealt with wayne?

    I have read some national party naysaying which is ironic coming from the no policy government.

    • Wayne (a different one) 19.1

      Well tracey, certainly not through building “cheap crap” housing in ghettos, because that’s what you will get ultimately.

      If Councils were forced to release more land for urban housing, this will in time force land values down, which is where the significant cost lies.

      In addition, from my perspective, we need more competition in the hosing supplies market, Fletchers dominate and thus control the pricing. Look at Australia, more competition = better value for money.

      And lastly, we need a strong economy, which in my humble opinion the National Government are really focussing hard on – because that will in turn equal a better working enviroment for all, including higher wages, so people can afford housing.

      But I will ask you this, where are the 400k homeless people living currently that require these houses?

      • PlanetOrphan 19.1.1

        A Strong economy Wayne? the Gnats’ are “Focusing”?, 170,000 unemployed and rising Wayne.

        And it aint the freakin GFC Wayne, it’s thet Gnats’ Wayne.

      • Tracey 19.1.2

        “If Councils were forced to release more land for urban housing, this will in time force land values down, which is where the significant cost lies.” Council is part of the policy Wayne.

        I agree about Fletchers, they are heavily subsidised by our governments…. oh no one calls it a subsidy but it is.

        “because that will in turn equal a better working enviroment for all, including higher wages, so people can afford housing.” How’s this going so far after 4 years? So far just legislation to lower wages? Also, how much have real wages increased over the last 20 years? You are dreaming if you believe this government is about higher wages.

        What is your definition of a strong economy, and how do you achieve that?

        As for your statement about 400k homeless people, are you saying there isn’t a housing shortgaae, or just not as big as Labour intends trying to address? You don’t live in Auckland do you?

  20. Brendon Harre 20

    Councils and the RMA rules that central government have imposed on them cause 80% of the increase in the cost of building new houses. The other 20% is that the building supplies duopoly hasn’t been broken up. The cost of new houses flows through to existing house prices and rents.

    Delays in getting consents mean developers with building permits have a local monopoly http://www.newgeography.com/content/002471-florida-repeals-smart-growth-law .

    So house prices are the result of bureaucratic monopoly times building duopoly times developers monopoly. With the banks and existing property owners being cheerleaders for their own selfish reasons.

    The reason it is so hard to reform this rigged system is the above vested interests are so powerful.

  21. Tracey 21

    Brendon, am not disputing your figures but am interested at how you reached them?

    “cause 80% of the increase in the cost of building new houses.”

    I am currently applying for a RC and then a BC and am interested in your breakdown.

  22. Draco T Bastard 22

    http://transportblog.co.nz/2012/11/18/rodney-hide-redux/

    The policy works by the council imposing a huge number of planning rules which limit density: height limits, density controls, yard controls, setback requirements, single-use rules and so forth. In the places where people most want to live and where prices are increasing the fastest, the planning rules actively stop the construction of more housing. It’s the planning rules that make building apartments, terraced houses and townhouses in the inner suburbs so difficult.

  23. lorraine 23

    Auckland council is developing guidelines for medium density housing. Some apartments are affordable to first home buyers at $300. I don’t think the Labour policy is about building apartments, terraced houses or townhouses. They are talking about detached houses with a plot of land. $300 all up for that is not affordable in Auckland or other places with a housing shortage.

  24. Populuxe1 24

    What I want to know is what will prevent this resulting in a Clinton-esque real estate bubble?

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